Why Most Crypto Projects Fail: The 11.6M-Token Graveyard

Why do most crypto projects fail? This research uses data from 11.6M dead tokens to explain failure patterns, warning signs, and what sets survivors apart.

Every new investor who enters crypto sees the same success stories first. Bitcoin rose from $0.003 to more than $126,000. Ethereum was built by a teenager and grew into a network worth over $242 billion. Early Solana holders turned $1,000 into life-changing wealth.

However, these stories represent only a tiny fraction of what happens in crypto. Most projects never come close to achieving that kind of success.

The broader picture looks very different. According to CoinGecko’s April 2026 research, 52.7% of all cryptocurrencies ever listed on GeckoTerminal are now dead. CoinGecko defines a dead token as one that recorded at least one trade but no longer shows any active exchange activity. During the same period, the number of projects tracked by GeckoTerminal grew from 428,383 in 2021 to more than 20.2 million by the end of 2025. Of those, 13.4 million had already failed.

The pace of those failures accelerated dramatically. In 2025 alone, 11.6 million crypto projects failed. That was the highest annual total on record and accounted for 86.3% of all project closures between 2021 and 2025.

Looking Beyond the Numbers

At first glance, these numbers are almost too large to process. However, they become much more meaningful when you look at why these projects failed. The same patterns appear again and again across different categories, market cycles, and generations of crypto projects. You can see them in Bitcoin’s earliest competitors, the ICO boom, DeFi, NFTs, and the Pump.fun memecoin wave of 2024 and 2025.

This article breaks down those patterns. It explains the eight most common reasons crypto projects fail, the warning signs that appear before a collapse, the categories with the highest failure rates, and the characteristics shared by the relatively small group of projects that have survived.

The Scale of the Crypto Graveyard

Before looking at why crypto projects fail, it helps to understand the scale of the problem. The numbers are surprising, even for people who have spent years in the industry.

The number of cryptocurrency projects tracked by GeckoTerminal grew from 428,383 in 2021 to more than 20.2 million by the end of 2025. Much of that growth came after the launch of Pump.fun, which made creating a token faster, cheaper, and easier than ever before. As documented in our memecoin research, PumpFun reduced the cost of launching a token to about $2 and only a few minutes of work. That removed many of the barriers to launching a project and unleashed a flood of new tokens.

The supply of tokens grew at an unprecedented pace, but demand did not. As a result, millions of projects entered an already crowded market with little chance of long-term survival.

52.7%

Percentage of all tokens ever listed on GeckoTerminal that are now dead, according to CoinGecko’s April 2026 research.

Before Pump.fun launched in 2024, crypto project failures remained in the low six figures across all years combined. Between 2021 and 2023, they accounted for just 3.4% of all project failures recorded over the past five years. Pump.fun did not make projects more likely to fail. Instead, it turned token creation into a high-volume process and flooded the market with projects that were never built to survive.

Understanding what “dead” means is just as important as understanding the numbers. A crypto project is considered dead when it loses its utility, liquidity, and community. Common indicators include near-zero trading volume, abandoned development with no GitHub commits for six months or more, a price decline of 99% or greater from its all-time high, inactive social media accounts, and expired project websites.

This definition also separates two very different types of failure. The first includes legitimate projects that failed despite trying to build something valuable. They ran out of funding, failed to attract users, or lost to stronger competitors. The second includes projects that were designed to fail from the beginning. Their creators launched tokens to attract capital before abandoning the project. Both groups produce dead coins, but the reasons behind their failure are very different.

11.6M

Crypto projects that died in 2025 alone

13.4M

Total crypto projects dead as of mid-2026

The fourth quarter of 2025 was the industry’s lowest point. During those three months alone, 7.7 million tokens failed. That was about 35% of all crypto project failures recorded since 2021.

The collapse followed the October 10 liquidation cascade, which erased $19 billion in leveraged crypto positions in a single day. The market shock accelerated failures, but it did not create them. Most of those projects were already running on borrowed time because they lacked users, liquidity, and active development. The liquidation cascade pulled the trigger. Weak fundamentals had already sealed their fate.

The Eight Reasons Crypto Projects Fail

From the altcoin wave of 2013 to the Pump.fun era of 2024 and 2025, the same failure patterns have appeared repeatedly. Most projects do not fail for a single reason. Instead, several weaknesses usually emerge at the same time. Understanding each one on its own makes it much easier to spot them before a project collapses.

01

No Product-Market Fit

The lack of product-market fit is the most common reason crypto projects fail. It affects every category of project, including memecoins, Layer 1 blockchains, DeFi protocols, NFT platforms, and infrastructure tools. Many teams build products that solve problems few people have or create solutions that nobody wants to use.

Between 2017 and 2022, crypto’s fundraising environment made this problem even worse. During that period, projects raised tens of millions of dollars through token sales and venture capital using little more than whitepapers, pitch decks, and bullish market sentiment. They secured funding before building a product and, in many cases, before proving that anyone wanted it.

As a result, many teams confused investor interest with market demand. Investors backed an idea, but users never adopted the product.

This problem is more common in crypto than in most other technology sectors because launching a token has historically been much easier than launching a software product with real users. Traditional startups usually need to demonstrate early traction before raising significant funding. In contrast, many crypto projects raised millions by telling a compelling story. That gap between narrative and demand explains why so many projects struggled after launch.

The ICO boom on Ethereum between 2017 and 2018 clearly illustrates this pattern. Hundreds of projects raised millions of dollars by promising to transform industries such as supply chain, healthcare, real estate, and gaming with blockchain technology. However, most either built products that attracted very few users or never delivered a product at all. Investors funded the vision, but the market never validated the demand.

02

Team Failure: Abandonment, Incompetence, and Fraud

The quality of a project’s team is one of the strongest predictors of whether it succeeds or fails. This is not unique to crypto. Startup research shows that team quality predicts early-stage success better than market size or technology. However, crypto adds another source of risk because many teams operate anonymously and face little accountability when projects fail.

Team failure in crypto usually falls into three categories.

Abandonment

The first type of team failure is abandonment. Teams stop building, stop communicating with their communities, and disappear as the project loses momentum and token vesting schedules end. This is the most common type of team failure, and investors can mistake it for a project going through a difficult period. GitHub activity stops, community channels become inactive, and the token price continues to fall without any explanation from the team.

Incompetence

The second type is incompetence. These teams genuinely wanted to build a successful project but lacked the technical, business, or operational skills to execute their vision. Many ICO-era projects fell into this category. They raised millions of dollars with ambitious whitepapers but had little experience building or scaling complex software products. Their intentions were genuine, but they could not deliver.

Fraud

The third type is fraud. These teams never intended to build a sustainable project. Instead, they created tokens to extract capital from investors. Rug pulls, exit scams, and soft rugs all fall into this category. In a soft rug, teams reduce their involvement while selling their token allocations instead of formally abandoning the project. As our research on crypto hacks and scams shows, fraud rises during bull markets. Retail FOMO, higher prices, and lower investor caution create the conditions that fraudulent teams exploit.

Team anonymity makes this category more dangerous. Bitcoin introduced pseudonymous participation, but many bad actors adopted the same model to avoid accountability. When anonymous teams disappear after raising capital, they face little reputational damage and few legal consequences in many countries. The Pump.fun era made this problem worse by allowing anonymous creators to launch, promote, and abandon tokens within days at almost no cost.

03

Liquidity Problems and the Thin Market Trap

Liquidity is the ability to buy or sell an asset without causing a large price swing. Every financial market depends on it. Smaller crypto projects face a challenge that many traditional assets do not. Their markets start with limited liquidity, and keeping that liquidity alive requires continuous capital, active market makers, or committed liquidity providers. Many projects cannot maintain that support over time.

The thin market trap is straightforward. A new token launches with an initial liquidity pool that allows people to trade it. Early buyers enter the market, the price rises, and the project appears to gain traction. However, if the liquidity pool is too small for the token’s market capitalization, one large sell order can push the price down.

That decline triggers a chain reaction. More holders rush to sell, the liquidity pool shrinks, and prices fall even further. As liquidity disappears, trading becomes harder, spreads widen, and buyers vanish. At that point, the project is effectively dead even if its blockchain, smart contracts, or website still exist.

Pump.fun’s bonding curve model creates another version of this problem. The platform supplies all of the initial liquidity through its automated mechanism instead of relying on the project’s own capital. Once a token graduates from the bonding curve to Raydium, it depends on outside liquidity providers to keep the market active.

Those providers have no obligation to stay. If trading activity slows or prices fall, they withdraw their capital to avoid impermanent loss. As liquidity dries up, the token becomes almost impossible to trade at a fair price. The project can fail without the team abandoning it because the market no longer supports the token.

04

Tokenomics That Destroy Value Over Time

Tokenomics covers a token’s supply, distribution, vesting schedules, and incentive mechanisms. Many retail investors overlook it, but experienced investors treat it as one of the first things to evaluate because poor tokenomics can undermine an otherwise promising project.

Insider Allocations and Vesting

The most common tokenomics problem is excessive insider ownership combined with short vesting schedules. When a project allocates 30%, 40%, or 50% of its total supply to team members, advisors, and early investors, those holders can create constant selling pressure once their tokens unlock. Retail demand rarely absorbs that supply.

In many cases, insiders bought their tokens at a fraction of the public launch price or received them at no cost. Once their lockup period ends, they have a strong financial incentive to sell regardless of the project’s long-term outlook.

The TRUMP token shows this pattern. Entities connected to Trump’s business interests controlled about 80% of the token supply through vesting schedules. As documented in our memecoin research, about 86% of TRUMP token holders lost money as insiders sold into retail demand.

Inflation and Token Dilution

Inflationary tokenomics creates another path to failure. Many projects issue new tokens to reward validators, pay liquidity providers, or attract users. Every new issuance increases the circulating supply. Unless the project creates value faster than it creates new tokens, existing holders lose value through dilution.

Many DeFi protocols during 2020 and 2021 offered high yields through token emissions. Those rewards came from issuing more tokens rather than creating sustainable value. As emissions continued, token prices fell, and yield seekers moved to newer protocols offering even higher rewards.

Regulation and Token Design

The data also shows how regulation affects token design. Music and video tokens failed at rates close to 75%. Crypto analyst Krüger argued that outdated regulations and token structures contributed to those failures. He wrote that many tokens were “worthless by design” because of the regulatory environment.

The SEC’s use of the Howey Test and its enforcement-first approach led many projects to adopt token structures that struggled to reward holders while reducing the risk of being treated as securities. Traditional equity structures do not face the same constraints, leaving many crypto projects with difficult trade-offs when designing their tokens.

05

Competition From Better-Resourced Projects

Blockchain development is open source, which means any team can fork an existing project’s code, improve it, and launch a competing product. Throughout crypto’s history, many projects introduced strong ideas first but lost to competitors with more funding, better execution, stronger marketing, or better timing.

The Layer 1 blockchain sector provides one of the best examples. Between 2017 and 2022, dozens of projects launched as “Ethereum killers” by promising faster transactions, lower fees, or greater energy efficiency than Ethereum.

EOS raised $4 billion during its year-long token sale, and many people viewed it as one of the most advanced blockchain platforms at the time. By 2022, its daily active users had fallen, developers had moved to other ecosystems, and its market capitalization had dropped by more than 95% from its peak. Tron, Cardano, IOTA, NEO, Waves, and Tezos also raised hundreds of millions of dollars but failed to maintain their positions.

Network Effects Create Winners

Competition in crypto becomes harder because blockchain networks depend on network effects. Developers build where users already are, users follow applications, and liquidity follows both. As each group grows, it attracts even more participants.

Once a blockchain reaches critical mass, attracting developers and users becomes much easier. Ethereum reached that point through DeFi, while Solana built momentum through retail trading activity. Newer networks then faced a much steeper challenge because they had to convince developers, users, and liquidity providers to leave established ecosystems.

Many projects remained technically competitive, but that was not enough. By 2022, they had lost ground because the leading networks continued to grow faster, attract more developers, and expand their ecosystems.

06

Regulatory Pressure and Legal Risk

Regulation has been one of the biggest risks facing crypto projects since the SEC released its 2017 DAO Report. The report concluded that many token sales qualified as unregistered securities offerings. As a result, projects that raised capital through token sales in 2017 and 2018 entered a legal environment with few clear rules. Regulators later defined many of those rules through enforcement actions.

Different Projects Face Different Risks

Regulatory pressure does not affect every project in the same way. Payment tokens with a clear use case have faced less scrutiny than tokens marketed with the expectation that buyers would profit from the work of a team. That distinction sits at the center of the Howey Test.

DeFi protocols without a legal entity or identifiable team have also faced different challenges from centralized exchanges that operate through registered companies and follow customer identification requirements.

When Regulation Ends a Project

Several well-known projects failed because of regulatory action. In December 2020, the SEC sued Ripple, arguing that XRP was an unregistered security. The lawsuit created years of uncertainty, led major exchanges to delist XRP, and slowed institutional adoption. Although the case ended in 2024, the litigation affected the project’s development and market position for years.

Telegram’s TON blockchain faced a similar outcome. The project raised $1.7 billion through a 2018 token sale. In 2020, the SEC obtained an emergency restraining order, forcing Telegram to shut down the project, return $1.2 billion to investors, and pay an $18.5 million penalty.

Geography Also Matters

Regulatory risk also depends on where a project operates. Projects based in countries with more developed crypto regulations, such as Singapore, Switzerland, the UAE, and, more recently, the United States, have had a more predictable legal environment than projects operating in countries with sudden policy changes or unpredictable enforcement.

Nigeria’s 2021 CBN circular restricting banking services for crypto businesses, China’s repeated crypto bans, and India’s changing regulatory approach all affected projects with large operations or user bases in those markets.

07

Security Failures and Smart Contract Exploits

A single security failure can destroy a project that might otherwise have survived. Many crypto projects built useful products, attracted users, and accumulated value before losing everything to a smart contract exploit or a custody failure they could not recover from.

As covered in our history of crypto hacks, attackers have changed their tactics over time. Early exchange hacks focused on stealing private keys. During the DeFi boom, attackers targeted smart contracts through reentrancy vulnerabilities, oracle manipulation, flash loan attacks, and governance exploits. Today, many attacks target the software interfaces that users rely on to review and approve transactions.

For smaller projects, a security breach can end the project even when the financial loss is relatively small compared with its total value locked. The exploit damages trust, causing users to withdraw funds and liquidity providers to leave. Winning that trust back is far harder than attracting new users through marketing.

Some projects recovered from major exploits. Uniswap, Aave, and Compound survived because they had the resources to respond, strong community support, and the ability to compensate affected users. Smaller projects rarely have those advantages.

Audits Reduce Risk but Do Not Eliminate It

The rise of the smart contract audit industry has improved the security of many protocols. However, audits cannot prevent every failure.

The attacker who exploited The DAO in 2016 took advantage of a known reentrancy vulnerability that an audit should have identified. The Ronin Network hack in 2022 resulted from poor validator key management rather than faulty smart contract code. No code audit would have prevented that attack.

Security requires continuous testing, monitoring, and improvement. Projects that treat an audit as the finish line instead of part of an ongoing process expose themselves to risks that can erase years of work in a single attack.

08

Bear Markets and the Funding Gap

Bear markets expose weaknesses that bull markets can hide. Many crypto projects could have survived during a prolonged bull market but ran out of funding before they reached the scale needed to support themselves.

Crypto venture capital follows market cycles. In 2021 and early 2022, investors poured more than $30 billion into crypto projects. Many teams raised large funding rounds at high valuations.

When the bear market began in 2022, the funding landscape changed. Valuations fell, investors became more selective, and raising another round became much harder. Projects that expected to secure new funding within 12 to 18 months suddenly faced a market where that was no longer possible.

The Token Sale Trap

Projects that relied on token sales faced the greatest risk. Many raised enough capital to launch but failed to build a business that generated enough revenue to fund continued development.

Token sale proceeds do not last forever. If a project fails to achieve product-market fit and generate protocol revenue before that capital runs out, it has few options. It can shut down, sell more tokens and dilute existing holders, or try to raise venture funding regardless of market conditions.

The 2022 and 2023 bear market forced many projects to close. Some had working products and active users, but they could not fund operations during a long period of low token prices and limited venture investment.

Many of those projects might have survived under different market conditions. However, the bear market exposed weaknesses in their business models that bull markets had hidden.

Warning Signs Before Crypto Projects Fail

The failure patterns above leave both on-chain and off-chain warning signs before a project collapses. No single indicator proves that a project will fail. However, several warning signs appearing together provide a much clearer picture.

Development Activity Stops

GitHub activity is one of the best indicators of a project’s health. Healthy projects continue to fix bugs, add features, update documentation, and maintain dependencies. As projects move toward abandonment, commits become less frequent before stopping altogether. Anyone can check the date of the latest commit in a project’s public repository.

A single quiet week is not a warning sign. Developers take vacations, and teams focus on major releases. The concern begins when a project goes six, eight, or twelve weeks without commits and the team offers no explanation. In many cases, development has already stopped.

Community Activity Declines

Community channels such as Discord, Telegram, and X reveal a great deal about a project’s health. Strong communities help users, answer questions, and discuss products, features, and future plans.

As projects decline, those conversations change. Some communities rely on bots to create artificial engagement. Others remove criticism and difficult questions instead of addressing them openly.

Price-only discussions are another warning sign. When a community talks more about token prices than product development, speculation has replaced long-term conviction. Communities built around price gains rarely survive once prices stop rising.

Token Supply Becomes Concentrated

Onchain wallet analysis provides valuable warning signs before many crypto projects fail. When a small number of wallets control a large share of the token supply, those holders can trigger a sharp price decline if they begin selling.

Tools such as Etherscan, Solscan, Nansen, and Arkham allow anyone to review token distribution. If the ten largest wallets control more than 50% of the supply, coordinated selling can overwhelm retail demand. As our bull run psychology research shows, tracking team wallets and vesting addresses can reveal distribution before prices react.

Vesting Unlocks Increase Selling Pressure

Projects that publish their vesting schedules give investors another way to assess risk. Large token unlocks increase the amount of supply entering the market, which raises the likelihood of selling pressure.

Platforms such as Token Unlocks and CryptoRank Vesting track upcoming unlock events across the crypto market. When a project approaches a large unlock and insiders hold large unrealized gains, onchain activity may reveal distribution before the market responds.

Exchange Delistings

Exchange delistings can severely damage a project’s liquidity and market value. Exchanges remove tokens for many reasons, including low trading volume, security concerns, regulatory issues, or failure to meet listing requirements. In many cases, declining activity begins months before the exchange announces the delisting.

A delisting from a major exchange does not always end a project. However, it should prompt investors to investigate further. Projects that lose their primary listings face fewer buyers, lower liquidity, higher trading costs on decentralized exchanges, and reputational damage from being removed by a major trading platform.

Why Some Crypto Projects Fail While Others Survive

Looking at the projects that survived is just as valuable as studying why crypto projects fail. Since 2009, millions of crypto projects have launched, yet only a small group has grown into lasting networks. Bitcoin, Ethereum, Solana, Chainlink, Uniswap, and Aave followed different paths, but they share several characteristics that helped them avoid the mistakes behind most crypto project failures.

They Meet User’s Need

The first is utility. The strongest crypto projects give people a reason to keep using them even when token prices fall. Whether they serve as a store of value, a settlement layer, a price oracle, or a decentralized exchange, users continue to rely on them because the product meets an ongoing need.

Projects that survive bear markets attract users before the market reaches its peak. They do not depend on rising prices to keep people engaged.

They Attract Developers

The second is a strong developer ecosystem. Bitcoin grew because developers built wallets, payment tools, and infrastructure around it. Ethereum expanded because developers created applications that attracted users who needed those services instead of simply buying the token.

Developer communities take years to build, and competitors cannot replace them overnight. That gives established networks an advantage that becomes stronger over time.

They Build Trust

The third is transparent leadership. Teams behind successful projects communicate openly, acknowledge problems, and explain how they plan to fix them. They accept responsibility when things go wrong instead of avoiding difficult conversations.

This has little to do with the size or reputation of the team. What matters is how the team communicates over many years, especially during difficult periods.

They Treat Security as an Ongoing Responsibility

The fourth is a strong security culture. Projects that survive multiple market cycles invest in repeated audits, bug bounty programs, and clear processes for responding to security reports.

Many projects that failed after an exploit ignored weaknesses that became obvious only after the attack. Successful projects work to identify and address those weaknesses before attackers can exploit them.

They Benefit From Timing

The fifth factor is timing. Bitcoin launched only weeks after the global financial crisis, when many people had lost confidence in the traditional financial system. Ethereum introduced smart contracts as developers searched for more programmable blockchains. Solana entered the market with the speed and low transaction costs that supported the retail trading boom of 2024.

The projects that survived made strong decisions, built useful products, and executed well. They also launched at moments when the market was ready for what they offered.

Which Crypto Projects Fail Most? What the Data Shows

The data shows that crypto projects fail at different rates depending on the category. CoinGecko’s research, along with other industry data, highlights clear differences that investors should understand before evaluating any project.

Memecoins and Low-Effort Tokens

Memecoins, especially those launched during the Pump.fun era, recorded the highest failure rates of any category. The graduation rate from Pump.fun’s bonding curve never exceeded 2% of daily token launches. Even among the projects that graduated, only a small share maintained price growth for more than a few days or weeks.

This outcome was not surprising. Most Pump.fun tokens were never built to become long-term projects. Their creators launched them to capture attention, generate trading activity, and collect fees.

Music and Video Tokens

Music and video tokens failed at rates close to 75%. Many projects tried to bring creator economies onchain, but they struggled to attract enough users.

The problem was straightforward. People who followed creators were not always interested in owning tokens, and projects failed to bridge that gap. As a result, many token models attracted attention but failed to build sustainable demand.

Layer 1 Blockchains

Layer 1 blockchain projects survived at higher rates than memecoins, but many still failed despite raising large amounts of capital. Between 2017 and 2022, dozens of projects launched as “Ethereum killers.” Only a handful, including Solana, Avalanche, and BNB Chain, maintained their position.

Many others lost developers, users, and liquidity. Some blockchains continued to operate, but without active ecosystems, their technical existence mattered little.

DeFi Protocols

DeFi protocols followed a different pattern. Projects such as Uniswap, Aave, Compound, Curve, and MakerDAO found product-market fit early, survived multiple market cycles, and continued to process large trading volumes.

Many other protocols relied on high token emissions to attract users. Once those rewards declined, users moved to newer platforms offering higher yields. Without sustained demand, those projects lost users, liquidity, and momentum.

What I’m Watching

The data leaves little room for debate. Most crypto projects fail. Most tokens lose their value within months of launch, and only a small percentage survive over the long term.

That does not mean the industry is failing; it reveals how innovation works. New industries produce thousands of ideas, most of which disappear, while a handful reshape the market. Crypto follows the same pattern. The difference is that retail investors absorb much of the cost of that trial-and-error process. That is why understanding why crypto projects fail matters before investing in any new project.

Active Wallet Growth

The first metric I watch is the relationship between active wallet growth and token price.

When a token’s price rises much faster than its active wallet count, a small group of holders may be driving the move instead of broader adoption. In contrast, projects that continue adding active wallets during price declines show stronger user demand. Those projects are more likely to withstand a bear market than projects driven only by speculation.

Protocol Revenue

The second metric I follow, especially for DeFi protocols, is the relationship between protocol revenue and token market capitalization.

Protocols that generate healthy revenue relative to their market value have stronger economic support than protocols valued mainly on future expectations. When market capitalization grows while protocol revenue remains low, investors should ask whether the product justifies that valuation. Looking at those two metrics together has helped explain many DeFi failures.

Utility Comes Before Adoption

As we showed in our Bitcoin history research, the projects that lasted built useful products before attracting widespread adoption.

Bitcoin gained users as a medium of exchange before it became a mainstream investment. Ethereum attracted developers who built applications before its price dominated headlines. Uniswap processed large trading volumes before launching its governance token.

The lesson is simple. Projects that solve user problems attract users before price momentum takes over. Projects that reverse that order rarely last.

The crypto graveyard is enormous, but the survivors share many of the same characteristics. They built products people wanted, attracted users before prices surged, and continued improving those products through multiple market cycles. Those patterns explain not only why some projects succeed, but also why most crypto projects fail.

Key takeaways:

52.7% of all cryptocurrencies ever listed on GeckoTerminal are now dead. In 2025 alone, 11.6 million projects failed, accounting for 86.3% of all crypto project failures since 2021. Pump.fun accelerated the failure rate by making token creation fast, cheap, and accessible.

Crypto projects fail for eight main reasons: no product-market fit, team failure through abandonment, incompetence, or fraud, liquidity shortages, poor tokenomics, competition from better-resourced projects, regulatory pressure, security failures, and the funding gap during bear markets. Most failed projects show several of these weaknesses at the same time.

The warning signs appear long before many crypto projects fail. Declining GitHub activity, inactive community channels, high token concentration in a small number of wallets, upcoming vesting unlocks, and exchange delisting notices all increase project risk.

The projects that survive share several characteristics. They build products people continue to use, attract strong developer communities, communicate openly, and treat security as an ongoing responsibility.

Failure rates vary across categories. Memecoins and low-effort tokens recorded the highest failure rates, while music and video tokens failed at rates close to 75%. Only a handful of Layer 1 “Ethereum killers” maintained their position, and DeFi protocols survived only when they built sustainable products instead of relying on token emissions.

Two onchain metrics stand out. Comparing active wallet growth with token price growth helps identify whether adoption is expanding alongside the market. Comparing protocol revenue with token market capitalization shows whether a project’s valuation is supported by its business activity.